Barratt delivers record profit as total builds hit nine-year high

Barratt Developments has delivered a record profit on rising house prices and a nine-year high on total builds.

Reporting its financial results for the year ended 30 June 2017, the UK’s largest house builder revealed earnings before tax rose 12.1% year-on-year to £765.1m.

Revenue for the period increased 9.8% to £4.65bn while completion volumes were up marginally by 0.4% to 17,395 – a nine-year high for the company.

The total average selling price on completions increased by 6% to £275,200 from £259,700 a year ago, with average selling prices up 8% to £313,000, which Barratt said benefitted from mix changes and underlying house price inflation.

David Thomas, chief executive of Barratt, hailed the housebuilder’s strong financial performance and the robust consumer demand it is seeing in the market.

“This has been another excellent year for the group. We have delivered a strong operational and financial performance and our highest completion volumes for nine years.,” he said.

“We are committed to increasing the supply of new homes as the UK’s largest housebuilder and we remain industry leading in terms of quality and customer service.

“The Group starts the new financial year in a good position with a strong balance sheet, healthy forward sales and we continue to see robust consumer demand supported by a positive mortgage environment.

“We are focused on driving further operational improvements through the business with a particular focus on margin improvement.”

John Allan, chairman of Barratt, said that whilst the general election in June created “some uncertainty”, the commitment from the government to tackle the country’s housing shortage remains strong.

He added that following the outcome of the EU referendum, it is continuing to focus on any potential impact the vote may have on its business.

”Following the outcome of the EU referendum, the Board continues to monitor carefully the potential impacts of the vote to leave the EU on our business. Market conditions remain good with a wide availability of attractive mortgage finance, which, alongside Help to Buy, continues to support robust consumer demand.”

He said June’s general election result had created some uncertainty but added government committment to tackle the country’s housing shortage remained. He added: ”The government’s Housing White Paper published in February contained many positive measures, particularly those aimed at speeding up the planning system and bringing forward more land for new homes.

”Market conditions remain good with a wide availability of attractive mortgage finance, which, alongside Help to Buy, continues to support robust consumer demand.”